NeoVolta Inc
For the period ended Mar 31, 2024. Filed May 10, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed May 10, 2024
NEOV$2.61+23.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-31; filed 2024-02-09.
0001683168-24-000845
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-03-31; filed 2024-05-10.
0001683168-24-003236
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 41 previous paragraphs and 41 current paragraphs.
22 unchanged; 17 reworded; 2 added; 2 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (2)
Current report
Nine months ended March 31, 2024 versus nine months ended March 31, 2023
Current report
Assembly Inventory Purchase
Removed paragraphs (2)
Previous report
Six months ended December 31, 2023 versus six months ended December 31, 2022
Previous report
Recent Assembly Inventory Purchase
Reworded paragraphs (17)
Previous wording
On April 14, 2023, California implemented Net Energy Metering 3 (NEM3) for subsequent new solar installations. NEM3 reduces the amount of NEM credit for each kilowatt (KW) of solar power sent to the utility from a rate of approximately $0.20 per KW to $0.09 per KW (each Utility varies). NEM3 effectively increases the average solar Return of Investment (ROI) from 5-6 years to 10-12 years (each Utility varies). Effectively, the Company believes that solar installation in California currently makes little financial sense without also including a battery system. Installing NeoVolta nets a ROI of 4-6 years. NEM3 reduced our sales from December 2022 until fairly recently as solar installers worked off their permitted NEM2 installs. We expect our sales to gradually increase going forward.
Current wording
On April 14, 2023, California implemented Net Energy Metering 3 (NEM3) for subsequent new solar installations. NEM3 reduces the amount of NEM credit for each kilowatt (KW) of solar power sent to the utility from a rate of approximately $0.20 per KW to $0.09 per KW (each Utility varies). NEM3 effectively increases the average solar Return of Investment (ROI) from 5-6 years to 10-12 years (each Utility varies). Effectively, the Company believes that solar installation in California currently makes little financial sense without also including a battery system. Installing NeoVolta nets a ROI of 4-6 years. We estimate that NEM3 reduced our sales from the enactment date in December 2022 continuing through the recently competed quarter ended March 31, 2024, as solar installers worked off their permitted NEM2 installs. We expect our sales to gradually increase going forward.
Previous wording
The following discussion reflects the Company’s revenues and expenses for the three and six month month periods ended December 31, 2023 and 2022, as reported in our financial statements included in Item 1.
Current wording
The following discussion reflects the Company’s revenues and expenses for the three and nine month periods ended March 31, 2024 and 2023, as reported in our financial statements included in Item 1.
Previous wording
Revenues - Revenues from contracts with customers for the six months ended December 31, 2023 were $1,781,958 compared to $2,104,941 for the six months ended December 31, 2022. Such decrease was primarily due to the impact of various macroeconomic and regulatory factors including new utility regulations in the State of California that we believe had temporarily caused an earlier economic disincentive for residential utility customers to acquire our energy storage systems from the December 2022 enactment date through roughly the end of last quarter.
Current wording
Revenues - Revenues from contracts with customers for the three months ended March 31, 2024 were $283,900 compared to $629,010 for the three months ended March 31, 2023. Such decrease was primarily due tovarious macroeconomic and regulatory factors including the negative impact of new utility regulations in the State of California that we believe has caused a temporary economic disincentive for residential utility customers to acquire ourenergy storage systems since the December 2022 enactment date and continuing through the three months ended March 31, 2024.
Previous wording
Cost of Goods Sold - Cost of goods sold for the six months ended December 31, 2023 were $1,454,913 compared to $1,765,119 for the six months ended December 31, 2022. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal period and resulted in gross profits on such sales of approximately 18% and 16%, respectively, in each period.
Current wording
Cost of Goods Sold - Cost of goods sold for the three months ended March 31, 2024 were $117,755 compared to $537,261 for the three months ended March 31, 2023. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal period. The resulting improvement in our reported gross profit in the three months ended March 31, 2024 compared to the three months ended March 31, 2023, however, was largely due to the reversal in the three months ended March 31, 2024 of an inadvertent overcharge of $93,000 that was made to Cost of goods sold in the three months ended December 31, 2023.
Previous wording
General and Administrative Expense - General and administrative expenses for the three months ended December 31, 2023 were $774,698 compared to $1,073,729 for the three months ended December 31, 2022. Such decrease was due to a reduction in stock compensation expense related to the Company’s equity incentive programs, partially offset by the recognition of an allowance for expected credit losses in the three months ended December 31, 2023 in the amount of $220,000.
Current wording
General and Administrative Expense - General and administrative expenses for the three months ended March 31, 2024 were $756,118 compared to $723,271 for the three months ended March 31, 2023. Such increase was primarily due to a higher allowance for expected credit losses in the three months ended March 31, 2024 of $340,000, compared to $300,000 in the three months ended March 31, 2023, partially offset by a decrease in stock compensation expense related to the Company’s equity incentive programs.
Previous wording
Research and Development Expense - Research and development expenses for the three months ended December 31, 2023 were zero compared to $7,746 for the three months ended December 31, 2022. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.
Current wording
Research and Development Expense - Research and development expenses for the three months ended March 31, 2024 were $10,392 compared to $1,290 for the three months ended March 31, 2023. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.
Previous wording
Other Income and Expense - Interest income for the three months ended December 31, 2023 was $12,781 compared to zero for the three months ended December 31, 2022. This increase was due to rising money market rates which have enabled the Company to earn interest on its investable cash in the three months ended December 31, 2023.
Current wording
Other Income and Expense - Interest income for the three months ended March 31, 2024 was $10,892 compared to zero for the three months ended March 31, 2023. This increase was due to rising money market rates which have enabled the Company to earn interest on its investable cash in the three months ended March 31, 2024.
Previous wording
Net Loss - Net loss for the three months ended December 31, 2023 was $556,044 compared to $987,529 for the three months ended December 31, 2022, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.
Current wording
Net Loss - Net loss for the three months ended March 31, 2024 was $589,473 compared to $632,812 for the three months ended March 31, 2023, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.
Previous wording
Revenues - Revenues from contracts with customers for the three months ended December 31, 2023 were $1,017,828 compared to $567,105 for the three months ended December 31, 2022. Such increase was primarily due to various macroeconomic and regulatory factors including an anticipated reversal of the previous negative impact of the new utility regulations in the State of California that we believe had temporarily caused an earlier economic disincentive for residential utility customers to acquire our energy storage systems from the December 2022 enactment date through roughly the end of last quarter.
Current wording
Revenues - Revenues from contracts with customers for the nine months ended March 31, 2024 were $2,065,858 compared to $2,733,951 for the nine months ended March 31, 2023. Such decrease was primarily due tovarious macroeconomic and regulatory factors including the negative impact of new utility regulations in the State of California that we believe has caused a temporary economic disincentive for residential utility customers to acquire ourenergy storage systems since the December 2022 enactment date and continuing through the nine months ended March 31, 2024.
Previous wording
Cost of Goods Sold - Cost of goods sold for the three months ended December 31, 2023 were $811,955 compared to $473,159 for the three months ended December 31, 2022. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal period and resulted in gross profits on such sales of approximately 20% and 17%, respectively, in each period.
Current wording
Cost of Goods Sold - Cost of goods sold for the nine months ended March 31, 2024 were $1,572,668 compared to $2,302,380 for the nine months ended March 31, 2023. The cost of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were sold in each fiscal period. Due to efficiencies that we have realized from taking over responsibility for manufacturing of our products from a contract operator since last year, we have improved gross profit to $493,190 in the nine months ended March 31, 2024 compared to $431,571 in the nine months ended March 31, 2023.
Previous wording
General and Administrative Expense - General and administrative expenses for the six months ended December 31, 2023 were $1,329,858 compared to $1,993,157 for the six months ended December 31, 2022. Such decrease was due to a reduction in stock compensation expense related to the Company’s equity incentive programs, partially offset by the recognition of an allowance for expected credit losses in the six months ended December 31, 2023 in the amount of $330,000.
Current wording
General and Administrative Expense - General and administrative expenses for the nine months ended March 31, 2024 were $2,085,976 compared to $2,716,428 for the nine months ended March 31, 2023. Such decrease was due to a reduction in stock compensation expense related to the Company’s equity incentive programs, partially offset by a higher allowance for expected credit losses in the nine months ended March 31, 2024 of $670,000, compared to $380,000 in the nine months ended March 31, 2023.
Previous wording
Research and Development Expense - Research and development expenses for the six months ended December 31, 2023 were zero compared to $28,646 for the six months ended December 31, 2022. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.
Current wording
Research and Development Expense - Research and development expenses for the nine months ended March 31, 2024 were $10,392 compared to $29,936 for the nine months ended March 31, 2023. Such fluctuation was largely due to timing differences in the level of the Company’s recent product development efforts.
Previous wording
Other Income and Expense - Interest income for the six months ended December 31, 2023 was $18,054 compared to zero for the six months ended December 31, 2022. This increase was due to rising money market rates which have enabled the Company to earn interest on its investable cash in the six months ended December 31, 2023. Interest expense for the six months ended December 31, 2023 was zero compared to $4,134 for the six months ended December 31, 2022. This decrease resulted from the conversion of our 2018 and 2021 convertible notes in conjunction with the closing of our public equity offering in August 2022.
Current wording
Other Income and Expense - Interest income for the nine months ended March 31, 2024 was $28,946 compared to zero for the nine months ended March 31, 2023. This increase was due to rising money market rates which have enabled the Company to earn interest on its investable cash in the nine months ended March 31, 2024. Interest expense for the nine months ended March 31, 2024 was zero compared to $4,134 for the nine months ended March 31, 2023. This decrease resulted from the conversion of our 2018 and 2021 convertible notes in conjunction with the closing of our public equity offering in August 2022.
Previous wording
Net Loss - Net loss for the six months ended December 31, 2023 was $984,759 compared to $1,686,115 for the six months ended December 31, 2022, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.
Current wording
Net Loss - Net loss for the nine months ended March 31, 2024 was $1,574,232 compared to $2,318,927 for the nine months ended March 31, 2023, representing the aggregate of the various revenue and expense categories indicated above. The Company has not recognized any income tax benefit for these net losses due to the uncertainty of its ultimate realization.
Previous wording
Operating activities. Net cash used in operating activities in the six months ended December 31, 2023 was $503,497 compared to $688,093 in the six months ended, December 31, 2022, reflecting a modest decrease in the impact of changes in working capital on net operating cash flow in the current fiscal year period.
Current wording
Operating activities. Net cash used in operating activities in the nine months ended March 31, 2024 was $988,827 compared to $650,600 in the nine months ended, March 31, 2023, reflecting a modest decrease in the impact of changes in working capital on net operating cash flow in the current fiscal year period.
Previous wording
Financing activities. Net cash provided by financing activities in the six months ended December 31, 2023 was zero, compared to $3,780,405 in the six months ended December 31, 2022. As further discussed below, our net cash provided by financing activities in the six months ended December 31, 2022 was entirely attributable to the successful completion of an underwritten public offering of our equity securities in early August 2022.
Current wording
Financing activities. Net cash provided by financing activities in the nine months ended March 31, 2024 was zero, compared to $3,780,405 in the nine months ended March 31, 2023. As further discussed below, our net cash provided by financing activities in the nine months ended March 31, 2023 was entirely attributable to the successful completion of an underwritten public offering of our equity securities in early August 2022.
Previous wording
As of December 31, 2023, we had a cash balance of approximately $1.5 million and net working capital of approximately $5.7 million. Currently, we are not generating a break-even level of net operating cash flow from our net sales. However, we anticipate that demand for our products will ultimately increase over time and that we will have sufficient cash to operate for at least the next 12 months.
Current wording
As of March 31, 2024, we had a cash balance of approximately $1.0 million and net working capital of approximately $5.1 million. Currently, we are not generating a break-even level of net operating cash flow from our net sales. However, we anticipate that demand for our products will ultimately increase over time and that we will have sufficient cash to operate for at least the next 12 months.